Squawk Pod Wall St Hits Main St, Neel Kashkari & China Strikes Back 4/11/25
Apr 11, 2025
Neel Kashkari, President of the Federal Reserve Bank of Minneapolis, shares insights on the U.S. economy amid rising trade tensions with China and significant tariff increases. He discusses investor sentiment moving away from the U.S. as a safe haven and the potential repercussions for markets. Meanwhile, the impact of political developments on economic stability is explored. The conversation also touches on the Fed's challenges with inflation management and the broader implications for consumers and retirement investments in light of these uncertainties.
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Trade Deficit and Investment
- The US trade deficit stems from global investors viewing America as the best investment.
- If this changes, bond yields will rise, potentially signaling a shift in investor preference.
Inflation as Priority
- The Fed prioritizes controlling inflation over economic growth, especially after years of high inflation.
- This focus aims to maintain public trust in the Fed's ability to manage inflation.
Private Credit Risk
- Private credit funds, while representing economic leverage, pose less systemic risk than banks.
- Their lower leverage ratios and longer-term funding contribute to this reduced risk.